Just create a shared folder on one of the data drive and choose this shared folder in the GUI of the backup plugin as backup destination.
Make sure you are able to restore from the backup.
An alternative solution is to use Clonezilla to clone the complete system drive. This is done offline but easier to restore.
Line highlighted in red - I think I am overthinking it. I think I got it now. My confusion was in the wording . Please let me know if I got right:
1. SHARED FOLDER in settings means - the location where backup is saving to
2. There is no need to tell/point the plugin in the settings to the system drive since it is the purpose the plugin was made for.
Make sure you are able to restore from the backup - what could be the complications?